Session 4

1. Session 4 RTI, Allahabad

2. Learning Objective At the end of session, the participants should understand the General Rules regarding withdrawal of Government money, handling of cash, responsibility for money withdrawn and instructions for rounding off transactions in Government accounts. RTI, Allahabad

3. Session Overview Withdrawal of money from Government is guided by certain principles and rules and is a very responsible job. There are certain laid down procedures and rules to be followed in this process. Similarly handling of cash is also a very important and responsible job governed by rules and well-defined procedures. Sometimes or other rules are not followed by DDOs/Accounts officer/ Treasuries resulting in loss/fraud/embezzlement of Government money. Instructor should explain in detail the rules, procedures and responsibility involved in withdrawal and handling of Government money to participants. This will help the participants to find out the violation of rules by the concerning officials havingthe responsibility of withdrawal and handling of cash. RTI, Allahabad

4. Course Structure To understand general rules regarding withdrawal of money from Government Account. General instructions for handling cash. Responsibility for moneys withdrawn. Instructions for rounding off transactions in Government accounts Exercise 4.1 and Group Discussion. RTI, Allahabad

5. Withdrawal of money from Government Account: 1). Unless the Government otherwise direct in any case, moneys may not be withdrawn from the Government Account other than against cheques issued by an Accounts Officer on an account opened in his favour, or by Cheque drawing D.D.O. on an assignment Account opened in his favour or cheques issued by the Treasury officer in favour of DDO, at a specified branch of the accredited bank. RTI, Allahabad

6. Continued… 2. A cheque drawing D.D.O. functioning under the scheme of departmentalization of accounts may withdraw money for such purposes as may be prescribed by the Controller General of Accounts by general order; provided that the Controller General of Accounts may permit withdrawal by any particular cheques drawing D.D.O. for any other special purpose. RTI, Allahabad

7. Continued… 3. An Accounts Officer and or cheques –drawing D.D.O. shall not draw a cheque for withdrawal of money for any purpose unless the claim for withdrawal complies with the provisions contained in these rules (Rule 11 of Receipt and Payment Rules) as to the person by whom and the form in which the claim shall be preferred. 4. No withdrawal shall be permitted on claim for the first of any series of payments of pay and allowances to a Government servant (other than a person newly appointed to Government service) prepared by a drawing and disbursing officer unless the claim is supported by a copy of the last pay certificate (in Form G.A.R. 2) issued by the drawing and disbursing officer of the previous office in which the Government servant had served. RTI, Allahabad

8. Continued… 5. An Accounts Officer of Cheque-drawing D.D.O. shall obtain sufficient information as to the nature of every payment he is making and shall not accept a claim which does not formally present that information, unless there are specific orders of Government against disclosure of the nature, on any individual claim or type of claims in the public interest. RTI, Allahabad

9. In case of state government: 1. Unless the Government in the Finance Department, after consultation with the Accountant General, otherwise directs in any case, moneys may not be withdrawn from the Government Account without the written permission of the Treasury Officer authorised in this behalf by the Accountant General. 2. The Accountant General may permit withdrawal for any purpose authorised by the Government. RTI, Allahabad

10. Continued… 3. The Treasury Officer has no general authority to make payments on demands presented at the Treasury unless it is strictly under the treasury rules framed for the State or properly authorised to make payments, or by a special order of the Accountant General. RTI, Allahabad

11. 4. The payment shall be made in the district in which the claim arises or in cases where Government may by a general or special order otherwise direct them. 5. The Treasury Officer (TO) shall be responsible to the Accountant General for acceptance of the validity of a claim against which he has permitted withdrawal and for evidence thwart the payee has actually received the sum. 6. The DDO and TO should pay careful attention to the rules regarding the completion of vouchers etc. 7. All bills and vouchers on which payments is made by the TO or which are enfaced by him or payment at Bank shall show to what head of account the payment is to be debited RTI, Allahabad

12. Responsibility for moneys withdrawn (1)    If a cheque drawing D.D.O. receives information from the Accounts Officer that moneys have been incorrectly withdrawn and that a certain sum should be recovered in respect of any bill passed by him, he shall effect the recovery without delay and without regard to any correspondence undertaken or contemplated with reference to the retrenchment order; and he shall, without delay, repay the sum in such manner as the Accounts Officer may direct. (2) The procedure to be observed by Government officer in regard to moneys withdrawn from the Government Account for expenditure shall be regulated by the provisions made in different rules. RTI, Allahabad

13. Continued… (3)    A Government officer supplied with funds for expenditure shall be responsible for such funds until an accounts of them has been rendered to the satisfaction of the Accounts Officer concerned. He shall also be responsible for seeing that payments are made to persons entitled to receive them. (4) If nay doubt arises as to the identity of the Government officer by whom an account of such funds shall be rendered, it shall be decided by the Government. RTI, Allahabad

14. General instructions for handling cash Unless otherwise provided, the following instructions shall be observed by all Government officers who are required to (a) receive Government dues and handle cash or (b) perform the functions of drawing and disbursing officers (with or without cheque drawing powers), or both: - (i) Every such officer (referred to in this rule as the Head of the Office) should maintain a cashbook in Form as prescribed for the purpose (GAR-3). (ii)All monetary transaction should be entered in the cashbook as soon as they occur and attested by the Head of the Office in token of check RTI, Allahabad

15. Exceptions… EXCEPTION (A). - An ‘Account payee’ crossed cheque or bank draft drawn in the personal name of a recipient (Government servant or third party) by a Pay and Accounts Officer (or by a cheque-drawing D.D.O.) and routed through a departmental office merely for the purpose of delivery to the recipient thereof, need not be entered by the latter office in its cash book; the delivery of such a cheque or draft to the concerned party may be recorded in, and watched through a separate ‘crossed cheques and bank drafts transit register’. Continued… RTI, Allahabad

16. EXCEPTION (B). - Cheques issued by cheque-drawing DDOs are required to be entered in a ‘Register of cheques issued’ in prescribed Form G.A.R.4. Therefore, only those cheques drawn by him, which are encashable in his capacity as disbursing Officer for arranging payments in cash, need be entered in the cashbook. EXCEPTION (C). - Receipts in the form of local cheques, or demand drafts (to be crossed) in favour of Pay and Accounts Officers accepted by non-cheque drawing DDOs. need not be entered in the Cash Book, but should be entered in the register of valuables (Form G.A.R.5) and remitted into the accredited bank duly supported by challans for credit to Government Account.) RTI, Allahabad

17. Continued…. (iii) The cashbook should be closed regularly and completely checked. The Head of the Office should verify the totalling of the cash book or have this done by some responsible subordinate other than the writer of the cash book and initial it as correct. RTI, Allahabad

18. Continued…    (iv). At the end of each month, head of the Office should verify the cash balance in the cashbook and record a signed and dated certificate to that effect. In regard to any discrepancy noticed therein, the instructions contained in Section V of Chapter 2 of the General Financial Rules, 1963, should be followed. In case the verification of cash balance is not possible on the last working day of a month on account of disbursement of monthly salary and allowances, it may be done on the first working day of the next month before making any transactions on that day. RTI, Allahabad

19. Continued… (v) Entries made in the cash book regarding remittance of receipts to the accredited bank for credit into Government Account should be attested by the Head of Office after verifying them with reference to the bank’s receipt recorded on the pay –in-slips or challans. When the credit appears in the receipt scroll from the bank, the actual date of realization of the cheque or draft should be indicated by cheque-drawing DDOs against the original entry in the cashbook so as to keep track of outstanding items. RTI, Allahabad

20. Continued… (vi) An erasure or over-writing of an entry once made in the cashbook is strictly prohibited. If a mistake is discovered, it should be corrected by drawing the pen through the incorrect entry and inserting the correct one in red ink between the lines. The Head of Office should initial every such correction and invariably date his initials. RTI, Allahabad

21. Continued… (vii) A Government officer who handles Government money should not, except with the special sanction of the Head of Office be allowed to handle also in his official capacity money which does not belong to Government. Where under any special sanction, a Government officer deals with both Government and non-Government money in his official capacity, the Government money should be kept in a cash box separate from the non-Government money and the transactions relating to the latershould be accounted for in a separate set of books and kept entirely out of the Government Account. (viii) The employment of peons to fetch or carry money should be discouraged. RTI, Allahabad

22. Adjustment of transactions of the Government with a State Government: No transactions of the Government with a State shall be adjusted against the balance of the Government except in accordance with such directives as may be given by Controller General of Accounts on the advice of the Comptroller and Auditor General of India to regulate the procedure for the accounting of such transactions. RTI, Allahabad

23. Instructions for rounding off transactions in Government accounts: The following transactions of the Government involving fractions of a rupee shall be brought to account by rounding off to the nearest rupee: 1. Personal claims of the Government servants and pensioners 2. All transactions of PAOs/Banks through Cheques and Challans. 3. Transactions between one Government and another or between two departments of the same Government. RTI, Allahabad

24. Continued… 4. Amounts covered into Indian Currency from Sterling or other foreign currencies. 5. Reserve Bank Remittances, other than those of sums representing dues fixed by or under any law or under any contractual obligation of the Government. Sums representing dues fixed by or under any law shall always be rounded off to the next higher rupee. 6. Deposits and receipts other than those which are fixed by or under any law or are specially exempted by the Government from the operation of the rules. Sums representing amounts fixed by or under any law shall always be rounded off to the next higher rupee. 7. The only type of transactions which have to involve paise would be cash transactions for petty purchases or sales which are reflected in a primary record like cashbook. RTI, Allahabad